1.ABC plc has issued 10,000,000 ordinary shares of a nominal value of $1 each. Details of the company's earnings and dividends per share during the last four years are as follows:

Year ended 31 Decemberearnings per sharedividend per share

1994$0.35$0.26

1995$0.33$0.27

1996$0.43$0.29

1997$0.42$0.30

The current, December 1997 market value of each ordinary share of ABC plc is $2.35 cum div.

The 1997 dividend of $0.30 per share is due to be paid in January 1998. Estimate the cost of capital for ABC plc's ordinary share capital

2.10 years ago, ABC plc issue 2.5 million dollars 6% redeemable debentures at a price of $98 per cent.The debentures are redeemable six years from now at a price of 102 dollars percent. They are currently quoted at 59 dollars percent, ex interest.Estimate the cost of capital for ABC plc's redeemable debentures.

3.For a bond, face value of 1000 dollars, four years life, coupon at 8%, YTM off 10%.Estimate both the price and duration